S.J.R. 7197, HF210202RO, HD210058RO
STATE OF NEW YORK
DIVISION OF HOUSING AND COMMUNITY RENEWAL
OFFICE OF RENT ADMINISTRATION
GERTZ PLAZA
92-31 UNION HALL STREET
JAMAICA, NEW YORK 11433
------------------------------------X S.J.R. NO. 7197
IN THE MATTER OF THE ADMINISTRATIVE : ADMINISTRATIVE REVIEW
APPEAL OF DOCKET NO. HF210202RO
: HD210058RO
CLINTON COURT INVESTORS DRO DOCKET NO.ZAK210545R
TENANT: JULIA & WILSON GANT
PETITIONER :
------------------------------------X
ORDER AND OPINION DENYING PETITION FOR ADMINISTRATIVE REVIEW
On April 23, 1993, the above-named petitioner-owner filed a
Petition for Administrative Review (hereafter PAR) against an order
issued on March 19, 1993, by the Rent Administrator, 92-31 Union
Hall Street, Jamaica, New York, concerning the housing
accommodations known as 941 Fulton Street, Brooklyn, New York,
Apartment No. 3L, wherein the Rent Administrator determined that the
owner had overcharged the tenant. On May 19, 1993, the Commissioner
issued an Order and Opinion Rejecting the Petition on the basis that
the petitioner did not submit a complete copy of the order being
appealed. Subsequently, the tenants obtained a judgment from the
court based on the overcharge finding. The petitioner-owner by
order to show cause moved to vacate the judgment on the basis that
it had timely refiled the PAR. DHCR records confirmed that the
owner had timely refiled the PAR under docket number HF210202RO.
Accordingly all parties including the tenants and the DHCR consented
to remit the matter to the DHCR for a determination on the merits
and to vacate the judgment obtained by the tenants. A court order
to this effect was issued on November 17, 1993.
The Administrative Appeal is being determined pursuant to the
provisions of Section 2526.1 of the Rent Stabilization Code.
The issue herein is whether the Rent Administrator's order was
warranted.
The Commissioner has reviewed all of the evidence in the record
and has carefully considered that portion of the record relevant to
the issue raised by the administrative appeal.
This proceeding was originally commenced by the tenants' filing
a complaint of rent overcharge in October, 1986. In such complaint,
the tenants stated that they had first moved to the subject
apartment on July 1, 1979 at a rental of $319.00 and had never
received a copy of the apartment registration form (hereafter RR-1
form).
The owner was sent a copy of the tenants' complaint on December
22, 1986. On October 21, 1992, the owner was sent requests for
S.J.R. 7197, HF210202RO, HD210058RO
additional information by the DHCR advising it that it was required
to submit a copy of the RR-1 Form with proof of service on the
tenant by one of the following methods: Tenant's signature
acknowledging receipt of the Apartment Registration (RR-1 Form) and
showing the date of receipt; or U.S. Post Office "Carrier Route Pre-
Sort" service form listing the apartment number and address of the
premises; or U.S. Post Office "Acceptance of Registered, Insured,
C.O.D. and Certified Mail" Form #PO-3877, signed and dated and
listing the tenant's name and address, including the apartment
number. The owner was also informed that DHCR records indicated a
failure to file an annual registration with the DHCR for the subject
apartment for 1985 and 1986 and the owner was directed to submit
proof of such filing. The owner was also sent a request for
additional information on January 19, 1993.
In a response dated March 2, 1993, the owner stated in
substance that there is no requirement in the Rent Stabilization
Code that the owner retain proof of service of the RR-1 Form on the
tenant and that based on the agency's acceptance of registrations
subsequent to 1984, the apartment is deemed registered for 1984.
The owner submitted a copy of the RR-1 Form but no proof of service.
The owner also stated that there was no rent overcharge because in
1976 under docket number 2AR4312-4353, the rent was established at
$406.00 per month.
In Order Number ZAK210545R, the Rent Administrator determined
that the owner had failed to submit proof of service of the initial
registration on the tenant and failed to file registrations for 1985
and 1986 as well. Based thereon the rent was frozen at the amount
of $319.00 and an overcharge of $25,137.09 was found including
treble damages.
In this petition, the owner alleges in substance that the DHCR
incorrectly set the initial rent at $319.00 rather than at $406.00
as established by the City of New York Department of Rent and
Housing Maintenance on November 10, 1976 under docket number
2AR4312-4353 due to a substantial rehabilitation and major capital
improvement; if at some time subsequent to 1976 the complainant
tenant paid less than the legal regulated amount, the owner should
not be penalized by the DHCR using a figure other than $406.00 as
the legal regulated rent in its computation; that treble damages
were improperly assessed since there was no willful overcharge in
that the owner was charging less than the legal regulated rent; that
the DHCR had a duty to inform the owner of any deficiency in the
record such as missing registration filing and such notification
must be within the applicable four year limitation on record-
keeping; that the DHCR cannot now in 1993 penalize the owner for an
alleged omission in 1984; that the subject premises was properly
registered in that in 1984 the tenant of record was one "J. Trent";
that Julia Bonita Trent married Wilson Gant Jr. on September 1,
1979; that the owner's copies of the registration for 1984 and 1985
S.J.R. 7197, HF210202RO, HD210058RO
indicate that the tenant of record was "Trent,J" so that DHCR's
records are confused; that the Rent Stabilization Code in effect in
1984 and 1985 did not require that registrations be sent by
certified mail; and that the owner's copy of the registration form
should be considered as proof of registration in accordance with the
DHCR form "Final Notice Requesting Proof of Registration", a copy of
which the owner submitted along with its PAR.
The Commissioner is of the opinion that this petition should be
denied.
The owner's contention that the DHCR incorrectly set the rent
at $319.00 rather than at $406.00 is without merit. It is noted
that the rent controlled rent of the subject apartment was set at
$406.00 effective February 1, 1976 under docket number 2AR4312-4353.
However, the owner was free to charge a lower rent when the
apartment became subject to rent stabilization and the records in
this case indicate that the owner in fact charged $319.00 upon first
occupancy by the tenants herein in October, 1979 and continued to
charge this amount until June 1, 1985. Accordingly, the Rent
Administrator correctly determined that the lawful stabilization
rent was $319.00.
The owner's contention that the subject apartment was properly
registered in 1984 is without merit. In order to establish proper
registration where a tenant denies receipt of the RR-1 Form, an
owner must prove by one of the methods described above that service
of the RR-1 Form on the tenant was effectuated. In the instant case
the owner did not submit the required proof of service although
afforded an opportunity to do so. The owner claims that confusion
may have resulted due to the fact that the tenant of record married
in 1984. Yet the owner has submitted no proof that said tenant of
record was served with the RR-1 Form either in her maiden or married
name nor that the tenant of record's husband was served. Further
there is no requirement that DHCR inform the owner of any deficiency
in the record such as a missing registration filing within a four
year period and the acceptance of later annual registrations by the
DHCR does not excuse the failure to file earlier annual or initial
registrations. Further the owner's copy of the registration form by
itself is not sufficient proof of service on the tenant. The DHCR
form "Final Notice Requesting Proof of Registration" submitted by
the owner, contrary to the owner's allegation on appeal lists
"owner's copy of registration form" as one of ten items that may be
submitted as proof of registration and states that since the DHCR
determination will be made based on the preponderance of the
evidence, that the owner should submit as much documentation as
possible. The Commissioner finds that the submission of the owner's
copy of an RR-1 Form by itself is not sufficient proof of service of
the RR-1 Form on the tenant.
Finally, the owner has not established that the overcharge was
not willful and accordingly, the imposition of treble damages was
S.J.R. 7197, HF210202RO, HD210058RO
warranted.
The owner is directed to reflect the findings and
determinations made in this order on all future registration
statements, including those for the current year if not already
filed, citing this order as the basis for the change. Registration
statements already on file, however, should not be amended to
reflect the findings and determinations made in this order. The
owner is further directed to adjust subsequent rents to an amount no
greater than that determined by this order plus any lawful
increases.
The Commissioner has determined in this Order and Opinion that
the owner collected overcharges of $25,137.09. This Order may, upon
expiration of the period for seeking review of this Order and
Opinion pursuant to Article Seventy-eight of the Civil Practice Law
and Rules, be filed and enforced as a judgment or not in excess of
twenty percent per month of the overcharge may be offset against any
rent thereafter due the owner. Where the tenant credits the
overcharge, the tenant may add to the overcharge, or where the
tenant files this Order as a judgment, the County Clerk may add to
the overcharge, interest at the rate payable on a judgment pursuant
to Section 5004 of the Civil Practice Law and Rules from the
issuance date of the Rent Administrator's Order to the issuance date
of the Commissioner's Order.
THEREFORE, in accordance with the provisions of the Rent
Stabilization Law and Code, it is
ORDERED, that this petition for administrative review be, and
the same hereby is, denied, and, that the order of the Rent
Administrator be, and the same hereby is, affirmed.
ISSUED
JOSEPH A. D'AGOSTA
Deputy Commissioner
S.J.R. 7197, HF210202RO, HD210058RO
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